Q2. AIR, Inc. and RMS, Inc. are in competition. Each can follow one of two strategies; it can either cooperate, or compete. The payoff matrix, showing profits in millions of dollars, looks like this: a) Identify any Nash equilibria in pure strategies to this game. Explain your reasons. b) Prove that there does not exist a Nash equilibrium in mixed strategies different from the pure strategy Nash equilibrium you found in (a). In one sentence, provide an intuitive reason for these results. c) If AIR acquired RMS, it could coordinate the two firms' strategies. (Assume there are no other advantages or disadvantages to the merger, and the two firms' payoffs still follows the table above.) What is the maximum amount AIR would be willing to pay for RMS? What is the minimum amount RMS would require to be willing to be acquired? Q2. AIR, Inc. and RMS, Inc. are in competition. Each can follow one of two strategies; it can either cooperate, or compete. The payoff matrix, showing profits in millions of dollars, looks like this: a) Identify any Nash equilibria in pure strategies to this game. Explain your reasons. b) Prove that there does not exist a Nash equilibrium in mixed strategies different from the pure strategy Nash equilibrium you found in (a). In one sentence, provide an intuitive reason for these results. c) If AIR acquired RMS, it could coordinate the two firms' strategies. (Assume there are no other advantages or disadvantages to the merger, and the two firms' payoffs still follows the table above.) What is the maximum amount AIR would be willing to pay for RMS? What is the minimum amount RMS would require to be willing to be acquired